Decline was around double that of other major banks
![Mortgage rules tear off a significant chunk of CIBC's volume](https://cdn-res.keymedia.com/cdn-cgi/image/w=1000,h=600,f=auto/https://ca.res.keymedia.com/files/image/iStock-compute-graph.jpg)
In its latest report of its results, the Canadian Imperial Bank of Commerce announced that new mortgage sales volume weakened by over 40% in the second quarter of this year – a decline brought about by the new mortgage rules that took effect at the beginning of 2018.
This was approximately double the shrinkage experienced by the bank’s competitors, Reuters reported.
More than any other major Canadian bank, CIBC heavily leans upon domestic mortgage transactions for its revenue – and has done so since its major expansion into the sphere back in 2012.
“CIBC continues to be the most sensitive to domestic lending,” Barclays analyst John Aiken noted.
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CIBC is looking at diversifying from domestic lending by opening its doors to more alliances and deals with U.S. entities, chief financial officer Kevin Glass said.
“Right now our focus is on organic growth,” Glass stated. “I think at some point we may consider inorganic growth. We will think about that in the longer term.”
Last year, the bank acquired Chicago-based PrivateBancorp for $5 billion, a movie that observers have argued is central to boosting CIBC’s growth prospects.
“They have a significant amount of capital and they can deploy a lot of that into the growth of PrivateBank,” Edward Lewis analyst James Shanahan said. “This is not a particularly diversified business compared to the other [Canadian] banks so the only thing it can do is grow PrivateBank.”